A client is under a PA sales tax audit. PA auditors note that sales tax on delivery charges of SLO wine/liquor orders from the PA fine wine and liquor stores is not charged on their invoices and should be. After an inquiry with PLCB and the Office of Chief Counsel we could not get a rational answer as to why the PLCB does not charge sales tax on delivery charges and why their policy would differ from revenue. Does the Department of Revenue have an explanation?
The law makes a distinction for these sales. Shipping charges are excluded from sales tax based on the Liquor Code at Section 305 (47 P.S. §3-305 (a)), which states: "In computing the retail price of such special orders for liquor or alcohol, the board shall not include the cost of freight or shipping before applying a mark-up that is equal to ten per centum of the cost of the product and taxes but shall add the freight or shipping charges to the price after the mark-up and taxes have been applied."